Saturday, September 17, 2005

Hurricane con begins: federal credit cards

Little noticed among the many derelictions in the federal response to Hurricane Katrina is that low level employees who use government credit cards just had their purchase limit raised to $250,000 per transaction. That's right -- the "micro-purchase threshold" is now a quarter of million dollars per transaction if you claim the purchase was disaster-related.

You may comfort yourself that there can't be many of these government-issued megacards, but you'd be wrong. According to an L A Times story there are currently 300,000 of them in circulation. And their use is not limited to professional buyers; very often they are issued to agency support staff -- perfectly reasonable if you are trying to keep the office in copier paper; madness if you are reconstructing a city.

Apparently there is a long history of mismanagement of credit cards in the federal government, just as there often is in businesses and non-profits. Plastic is just so easy to use; it lends itself to abuse. In fact, the Office of Management and Budget was just about to issue a circular on a new program to try to get a grip on credit card use named "Improving the Management of Government Charge Card Programs." Guess that is at least postponed. Forbes Magazine asserts:

[T]he Government Accountability Office has found in previous [disaster] cases the cards have been used to buy jewelry, leather goods and entertainment.

We all want to do all we can to help the people of the Gulf Coast recover -- but I do think that Congress, which approved the new "limit,' could have put in a few controls over what is done with our tax dollars.

I admit it is sort of fun to think about what might be purchased with those cards. If I had one, I might think the disaster required a nice light-weight kayak; what would you buy?

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